Rolls-Royce has been the top-performing FTSE 100 growth stock for the past three years, with a 350% gain. After analyzing the numbers, the decision was made to sell Rolls-Royce shares due to concerns of being overbought and a potential sharp correction. While the rally was enjoyed and provided significant returns, the focus is now on rebalancing the portfolio with more reliable income shares.
Entain (LSE: ENT) has been the worst-performing company on the FTSE 100 list for over three years, experiencing a 65% decline. The company has faced challenges due to high inflation affecting consumer spending on non-essential activities. Despite recent struggles, there are signs of improvement, such as a boost in share price following the Euro final.
Analysts forecast a significant increase in earnings for Entain, which could lead to a more favorable price-to-earnings ratio. Independent analysts predict a potential price increase of more than 50% in the next 12 months, which could bring the company back to profitability.
While comparing an aerospace and defense engineer like Rolls-Royce to a gambling company like Entain may seem unusual, there are similarities in their potential for growth. The current price of Entain appears undervalued, with the potential for significant returns in the future.
Amid uncertainties surrounding economic recovery and changes in listing requirements, there is optimism that Entain will see a recovery this year. While it may not reach the heights of Rolls-Royce’s rally, there is confidence in Entain’s potential for growth. Overall, the focus is on Entain as a promising investment opportunity in the next buying round.